Symantec the Latest to Consider Breaking Up

Company officials may soon announce that Symantec will split in two, with security going one way and storage another, according to a report.

Symantec logo

Symantec may be the next major tech vendor to split in two, in the wake of similar moves by Hewlett-Packard and eBay.

Citing unnamed people with knowledge of the matter, Bloomberg News reported Oct. 8 that Symantec officials are considering breaking the company in two, with one company focused on security and the other on data storage. One of the people said an announcement could be made in a few weeks.

Symantec officials have declined to comment on the report.

The report about Symantec comes two days after venerable Silicon Valley company Hewlett-Packard announced it will split in two over the next 12 months, with one—which will be named HP Inc.—selling printers and PCs, and the other—Hewlett-Packard Enterprise—concentrating on corporate IT solutions and services. Officials with eBay announced Sept. 30 that the online auction site will split off its PayPal online payment processing businesses next year, creating two companies.

The recent announcements highlight a trend within the tech industry of some vendors splitting or shedding business units in an effort to become more focused and streamlined and to give a boost to their bottom lines. HP CEO Meg Whitman, in announcing the decision to split up the company after several years of pushing back at pressure to do so, said the result will be two more nimble companies that will have greater freedom to pursue their respective roadmaps and focus more narrowly on their customers.

Other major tech companies are finding themselves under scrutiny. Soon after HP's announcement broke, speculation turned to Cisco Systems, a massive company that is aggressively building out its product portfolio in an effort to transform itself from a networking box maker into a major enterprise IT solutions provider. Storage giant EMC has been under pressure from an activist investor to divest itself of most or all of its 80 percent stake in VMware. Investor Elliott Management has argued that having VMware in the fold is a drag on EMC's finances, though EMC officials have argued that the company's federated corporate model that governs its relationship with subsidiaries VMware, RSA and Pivotal has been a benefit.

To be sure, not all companies are taking the smaller-is-better route. Dell is looking to become a larger IT solutions vendor, leveraging in-house development and acquisitions to broaden its product lineup in such areas as networking, storage, software and the cloud. Oracle has continued to grow via acquisitions, and Lenovo—which used its 2005 purchase of IBM's PC business to become the world's top PC vendor—is hoping to see the same success in servers after buying IBM's x86 systems business and in mobile devices with the upcoming acquisition of Motorola Mobility from Google.